1 in 8 adults rarely watch normal TV
Ivan Radford | On 06, Nov 2016Reading time: 5 mins
One in eight adults now rarely watch “normal” TV, as the rise of subscription streaming services continues to impact traditional viewing habits.
The latest study from YouGov and Zuora shows that 13.9 million of British consumers (27 per cent of the adult population) now subscribe to a VOD service such as Netflix or Amazon Prime Video. Now 6 million of those say they rarely watch normal TV, the equivalent of 12 per cent of the adult population. Among those aged 25 to 34 who subscribe to streaming sites, that number rises to 58 per cent.
The rise of SVOD viewing, though, is also about affordability, as younger viewers prefer to pay a monthly fee to access something rather than pay individually for a box set or be locked into a contract. Among 16 to 24 year olds, nearly twice as many subscribe to video streaming services as they do to cable or satellite services (44 per cent vs. 26 per cent). Among 45 to 54 year olds, though, it’s the other way around: 23 per cent vs. 49 per cent. 30 per cent of Brits who subscribe to VOD services, meanwhile, never plan to buy a DVD or Blu-ray again.
Netflix is leading the SVOD charge, with 12.4 million subscribers (one in four UK adults), followed by Sky Go (7.2 million or 14 per cent), Amazon Prime Video (6.7 million or 13 per cent) and NOW TV (3.1 million or 6 per cent). On average, UK subscribers spend £17.53 per month on video streaming services, which suggests that many sign up to several services simultaneously, as invidual services fail to provide the right price or content library to match each person’s tastes. The figure is still dwarfed, though, by the £60.83 spent on average on pay-TV providers, as companies such as Sky or Virgin continue to charge hefty flat fees for large channel bundles, as opposed to more tailored content packages at lower prices.
The Zuora and YouGov surveys, which are carried out on a regular basis, highlight just how embedded the subscription mindset has become to consumers’s day-to-day habits, with 59 per cent of subscribers saying Netflix, Amazon or NOW TV are integral to their lives. Indeed, 40.2 million Brits are now subscribing to at least one product or service, be it video, music or otherwise; British subscribers now spend on average 12 per cent of their disposable income on subscription services.
All of this gives huge power to VOD companies, as the direct nature of a subscription relationships gives them the chance to mine data – from millions of plays a day to ratings and searches, as well as viewing times, device information and social media feedback. The result is a detailed picture of what viewers like, want and watch. The question is how that impacts VOD services in the future, whether they change their content, pricing or introduce other packages. The industry is still in its relative infancy, but one thing’s certain: it will only keep growing.
The rise of the subscription generation
24th June 2016
8 in 10 British adults now subscribe to a product or service, reveals a new study that highlights just how widespread services such as Netflix have become.
40 million Brits subscribe to at least one service, says research by Zuora and YouGov. More than a quarter of the UK population (27 per cent) are signed up to a video streaming service, such as Netflix, Amazon Prime or Sky Go – the equivalent of 13.9 million people. 1 in 4 of those subscriber to Netflix, while 14 per cent subscribe to Sky Go and 13 per cent are signed up to Amazon Prime Video.
The figures do not take into account whether people are signed up to Amazon Prime or the standalone Prime Video service, nor do they consider Sky’s OTT subscription service, NOW TV, seeing as Sky Go is generally included as part of a Sky contract. They do, however, highlight the rising preference for subscription services over ownership outright.
It’s not just VOD: Spotify and Apple Music are transforming the music industry, while companies such as Graze are making waves in the food and drink world.
Indeed, Brits are now spending 12 per cent of their monthly disposable income on subscription services. Subscriptions are just as popular with older age categories as they are with millennials, with many consumers saying they would subscribe to internet-connected devices and services if commonly available in the future.
What is making us such happy subscribers? While the concept of owning products outright remains important to the British public, the report shows that two fifths of the population claim they use subscription services more now than they did 5 years ago, with a further one quarter of the population stating they will use them more in the future.
Younger consumers (16-24) are more likely to be subscribing to VOD services – 76 per cent of them have subscriptions – and they attribute the appeal to the convenience of not having to regularly buy products, and having instant access to what they need.
Older customers strongly rely on the automatic and recurring delivery of products and services for their daily lives. The penetration of subscription services is unsurprisingly lower, though, among older Brits: those over 55 are most likely to subscribe to cable/satellite TV. However, 10 per cent of over-55s do subscribe to Netflix, 10 per cent to Sky Go and 9 per cent to Amazon Prime.
“Due to the ever-increasing availability of products and services, the need for instant gratification is growing. Consumers are now accustomed to receive instant access to a product or service they require, such as countless songs or films through online streaming services. The actual interaction with the product or service activates the reward system in the brain controlled by the neurotransmitter, dopamine. This system is responsible for the pleasure we feel when we do enjoyable things, like eating chocolate. Subscriptions can support the production of dopamine, as they provide consumers with access to the things they want, when they want them – therefore meeting the desire for instant gratification,” says Kate Nightingale, Consumer Psychologist.